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GDI Integrated Facility Services Inc
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Good morning, ladies and gentlemen, and welcome to the GDI Integrated Facility Services, Inc. Fourth Quarter 2022 Results Conference Call. [Operator Instructions]. This call is being recorded on Thursday, March 2, 2023.
I would now like to turn the conference over to Stephane Lavigne. Please go ahead.
Thank you, operator. Good morning, all. Welcome to GDI's conference call to discuss our results for the fourth quarter of fiscal 2022. My name is Stephane Lavigne, I'm Senior President and Chief Financial Officer of GDI. I am with Claude Bigras, President and CEO of GDI; and David Hinchey, Executive Vice President of Corporate Development.
Before we begin, I would like you to make aware that this call contains forward-looking information, and we ask listeners to refer to the full description of the forward-looking safe harbor provisions that is fully described at the beginning and in the MD&A filed on SEDAR last night. I will begin the call with an overview of GDI's financial results for the fourth quarter, and then we'll invite Claude to provide his comments on the business.
In the fourth quarter, GDI recorded revenue of $588 million, an increase of $155 million or 36% over Q4 of last year, made up mainly of organic growth of 10% and growth from acquisitions of 23%. We recorded an adjusted EBITDA of $41 million in the quarter, an increase of $7 million or 21% over Q4 of last year. Additionally, during the quarter, we recorded a onetime implementation cost of $1 million related to the human resource information system project, which we launched on January 1, 2023, for a portion of our U.S. operations representing more than 5,000 employees.
On a year-to-date basis, revenue increased by $575 million or 36% to reach close to $2.2 billion. Organic growth was 9% year-over-year, and revenue growth from acquisitions was 26%. Adjusted EBITDA for the year amounted to $153 million, an increase of $20 million or 15% over 2021.
Now moving to our business segments. Our Janitorial Canada business segment recorded revenue of $144 million in Q4, an increase of $4 million or 3% compared to the fourth quarter of 2021, which was all generated organically. This segment reported adjusted EBITDA of $16 million compared to $18 million in the fourth quarter of 2021, representing a decrease of $2 million, which was expected given the lower COVID impact.
Our Janitorial USA business segment recorded revenue of $176 million in Q4 and adjusted EBITDA of $14 million, representing an increase of $87 million and $6 million, respectively, when compared to Q4 2021. These increases are mainly due to the acquisition of IH Services on December 31, 2021.Organic growth in the U.S. segment was slightly negative, mainly due to additional incremental services provided in last year's Q4. Both Janitorial Canada and Janitorial U.S. were impacted by the expected decline in COVID-related services provided in the quarter compared to the prior year, partially compensated by contractual recurring revenue increases.
Our Technical Service business segment recorded like revenue of $250 million or growth of 32% over Q4 2021, with 20% organic revenue and 9% generated from acquisitions. This segment generated a record adjusted EBITDA of $17 million, representing an adjusted EBITDA margin of 7%. The Technical Service segment is now operating at a normal seasonal capacity levels.
Finally, our Complementary Services segment reported revenue of $25 million and negative adjusted EBITDA of $1 million compared to revenue of $18 million and negative adjusted EBITDA of $1 million in Q4 2021. This segment recorded organic growth of 39% in Q4 2022, the majority of which was due to GDI IFS, which was launched at the beginning of 2022.
Now I would like to turn the call to Claude, who will provide further comments on GDI's performance during the quarter.
Thank you, Stéphane. Thanks, everyone, for taking the time to listen to our earnings call for our last quarter of 2022.
So I'm very pleased with all -- all of the GDI business units performed in the fourth quarter. Our Janitorial businesses in both Canada and the United States continued to deliver strong results, even while onetime COVID extras have been progressively decreasing. Occupancy rate in the commercial office market in Canada are slowly rising as most of the tenants within our clients' building have rolled out hybrid return-to-work policies.
This is important to GDI as the Class A office market is the largest component of our Canadian Janitorial portfolio, representing approximately 30% to 35% of revenue. All of the other markets that we service have largely returned to pre-COVID occupancy levels. It's worth mentioning that for the first time in GDI history, our Janitorial USA business surpassed the size of our Canadian Janitorial business.
Our Ainsworth Technical Service business had a very strong quarter, recording $250 million in revenue and an EBITDA margin of 7%, combined with an organic growth of 20%. While the last quarter is typically Ainsworth's strongest quarter, the business is also benefiting from a strong competitive position, which is enabling it to gain market share. The backlog at Ainsworth continue to stand at an all-time high, and we have a positive outlook for the business as it moves through Q1, which is traditionally its weakest quarter.
Our integrated facility services business is executing on its first 2 contracts, and the team has built a solid pipeline of opportunities to pursue in Canada and in the U.S. Our janitorial product manufacturing and distribution business, unfortunately, is still suffering from lower occupancy rate in the commercial office market, but we expect the business to gradually improve as occupancy rate rises.
As I look back on 2022, I can't be more proud of what the team at GDI has accomplished. We surpassed the $2 billion revenue milestone last year while generating a healthy level of profitability. GDI has come a long way from its IPO in 2015 when our Janitorial Canada segment represented 75% of its total revenue. To date, this segment represents 26% of our total business as a result of our diversification strategy.
Our Technical Service business has become our largest business segment, with $850 million in revenue in 2022, which represents around 38% of our overall business. Today, revenue generated by GDI is almost at par between Canada and the U.S., and our U.S. business is growing rapidly.
We have built GDI into one of the largest and what I feel is a leading fully integrated facility service provider in North America. There are very few companies in North America that delivers the full range of services that GDI offers on a self-performed basis.
GDI has proven that it has the ability to perform well in a variety of difficult environments. As we face a potential economic slowdown or proactive recession in 2023, I am confident that our business has the flexibility and the resilience to execute on its growth strategy.
Our balance sheet is strong. Our leverage ratio is well within our comfort zone, and there remains a significant amount of room to continue to grow our business and capture potential opportunity as they arise. Again, I'm very confident on the long-term prospect of GDI.
Well, thank you again for taking the time to listen to our call this quarter. And operator, you can open the line for our analysts.
[Operator Instructions]. Your first question comes from Derek Lessard with TD Securities.
Congratulations on a strong year managing some really tough challenges. Say, can you start with -- yes, just wanted to start with the Technical Services segment. Clearly, a strong result for you guys. So it's a 2-part question.
The first is could you just talk about your thoughts around the sustainability of the organic growth you saw in Q4 heading into 2023 and the record margins? And the second part, which tie into the first, is you did point to new contract wins and share gains, so I was just wondering if you could add some meat to those bones.
Yes, absolutely. That's a good question. Well, first, if you remember, the start of 2022 on the tech segment, we had a kind of a slowdown because of supply chain challenges and job sites restructuring because of COVID. So this was a slow start. But during the year, this problem has been overcome. And with a very, very, very strong backlog, we were able, at the year, grow, to execute and convert this backlog into revenue.
Q4 has been extremely active on that front. So yes, our 20% growth is -- yes, I'm very happy about it. But if you were asking a long-term perspective, I think that, what, in the high single-digit or very low 2-digit, maybe around the 10-ish, but we don't give forecast, but please help me here. But it will be probably the more sustainable figure, understanding that we still have an all-time high backlog for 2023. And we don't see any particular major problems, so that's -- this is a bit where we are.
And the second part is market share is, through some of the acquisitions, it enabled us to really participate in jobs or contracts that we were not doing originally, like large piping projects, large building retrofit project like in the U.S. So this being said, it gave us some very, very good wins in 2022 and going into 2023. So this is a little bit what we figured by market share.
Yes. Okay. Claude, that's very helpful. And another one for me is, I guess, if I'm looking at the national Class A vacancy rates in Canada, clearly, they're obviously up 50% since the pandemic started, at least according to the CBRE. Just wondering how you guys squared that away with what's going on in your markets and maybe the outlook for the janitorial market?
Well, it's a moving target, to be very honest. I can tell you that like I've been saying since the beginning of our discussions, we expected that post-COVID, the extra services we get almost to a normal, but maybe a little bit more than usual because there are still clients that would require a little bit of services there.
But the occupancy for the occupied space being a little bit reduced, it enables us more or less to generate a little bit better margin. So overall, it will be positive for us in terms. And what we are prepping for is we are changing from a very stable billing organization to a dynamic flexible, customized service menus to our clients because there would be a different approach, depending on each companies. I think you figured that out already.
Your next question comes from Jonathan Goldman with Scotiabank.
So we were plausibly surprised by the janitorial margins in the U.S. at 8%, so not out of line from pre-COVID levels. But I think on the last earnings call, you called out a legacy contract with a major customer that would weigh on margins until the middle of this year. So I'm just trying to figure out the moving parts of the margin in the quarter and kind of expectations for the margin trends in 2023.
Yes. Well, the legacy contract, just to make sure that I explained it very well because I don't recall exactly. The legacy contract is we have a very important customer in the U.S. that we liked, actually. But through this contract, there is what we call pass-through expenses.
So we had to pass through some significant expenses at 0 margin tag on those. So that artificially has impacted our percentages. But this taken out is we are running relatively normally. So this is probably what you're referring to in the U.S.
Yes. That's exactly I was talking about.
And the contract will be due sometime this year, and we intend to work with our customer to, I would say, to offset that particular. It's an accounting thing. And so we try to figure out the best way to go forward with them because we actually are very pleased with this customer overall besides that.
No, that's good color. I appreciate that. And then just maybe circling to the organic growth trend in Janitorial Canada. So if I look at the 3-year trends over the past 3 years, it seems the organic growth rate is about half of what it was pre-COVID.
Like I know there's a lot going on there. There's specialty cleaning volumes coming up. Occupancy rates are still below pre-COVID levels. But are there any other dynamics going on that would disrupt that historical GDP-plus type growth trend in that business?
No. Listen, I can tell you that the only thing I would like to point out, Jonathan, and I'm very open is we had a little bit of a bigger churn in Central Canada than I would have expected for XYZ number of reasons, not especially related to service, related to pricing. Besides that, the rest is almost business as usual.
And over time, I realize that, first of all, COVID was pretty disturbing to start with. 2022 was not our greatest vintage on new contract acquisition. And not being a month to 2 months in 2023, I feel like after a slower year comes a very good year in growth. I'm expecting 2023, without doing forecast, I think it will deliver on its growth because it looks very promising so far. But 2022 was not a great vintage on new acquisition of contracts.
Okay. Perfect. And if I could just squeeze one more in on the Technical Services. I mean, obviously, the organic growth was strong, and you talked about expectations for that business. And I'm not sure how to phrase this question, but you talked about the business running at normal seasonal capacity.
How much excess capacity do you have in that business? Or is there a point where you're going to have to invest more in resources or people to maintain the current pace of growth, especially with the share gains?
Well, you're absolutely on the point. If we have more capacity, probably we would have been able to convert even a little more. For sure, acquisition of talent, training of talent is one of our priorities that we have. This being said, the good news is we are disseminated in about 40 markets. So it enables us to recruit in 40 different markets, where we can accomplish and deliver more services.
If we were concentrated in one market, we would have a challenge to recruit. But since we're very disseminated, at least this is a plus. Yes, we are -- we're not a 102% capacity. We probably are maybe at 98% on the labor -- I mean on the tech side because we always on technician's labor hours. But we were recruiting, and we're growing our workforce.
No, that makes sense. And it seems like probably a good problem to have.
Yes. But the only thing you don't want is to get into overtime, and you don't want to put a speed of process where you can endanger the health and safety of our workers. So we always work on the line of safety and durability. So this is the priority of the business.
Your next question comes from John Zamparo with CIBC.
I want to start on Technical Services. And a comment you've made earlier, Claude, it sounds like you're quite bullish on that segment continuing to grow. And I wonder if you can share, as you grow the top line in that segment, do you see efficiency benefits that would trickle down to an expanded EBITDA margin? Or should we expect the pace of EBITDA to grow around or similar to the pace in sales growth?
Well, I'll tell you something, John, this is the idea. The growth of our revenue certainly would have a positive effect on the bottom line as our internal structure with -- in percentage will reduce in percentage. So the mathematical approach is, yes, it will increase the EBITDA. We have a specific target for Ainsworth, and they're starting to be around the target that we wish for.
Now the only thing I could say is our business mix is very important. And we are focusing a lot on building up our maintenance and service business for the reasons that we know is the market where it's going and the sustainability of the margins. And this, with higher-margin services like this, it should certainly affect positively the bottom line. So it is within our focus. But even at this present state, we're very bullish on it.
Got it. Okay. On your complementary division, do you need to see a certain level of office occupancy to get that segment back to the EBITDA margin it was at from pre-pandemic?
Well, it will help for sure. But we're more into reorganizing our line because you see a lot of things happened in this business unit after the pandemic. We had to deal with excess inventory. We had to deal with prices variations. So it has been, I would say, a challenging ride for our chemical manufacturing.
But that being said, now we have established a plan. We have acquired a plant in the U.S. We're doing what we have to do. Also in our expense, we invest some money into partially retrofitting the plant.
So even if you have to go along on the ride with us, probably we'll need 2023 to really put back the business where it's supposed to be. It's a work in progress, but we are working hard on it. We don't leave it, and we certainly don't leave this business as an orphan. We are working hard on it.
Okay. Understood. I wanted to follow up on your answer to a prior question. When you said 2022 wasn't your best year for winning contracts in Janitorial Canada, do you attribute that to increasing competition or a more price-sensitive consumer? You referenced behavioral changes from COVID, but I just would like to better understand that dynamic.
If I add the engineering answer to that, I'd be very happy and that's smart. I can tell you this that we -- I did that for 30 years. We have 2, 3, a great, great year, 2, 3 normal year. And suddenly, we have a lower year fueled by what the contract renewals, economical. I think people were getting out of COVID, and they wanted to try to capture some of the savings.
I have no particular reason. I think it's a sum of many things. But in general, we usually grow about 5%, 6% on our renewal and new contract wins. This year was around 2-ish, so it was a slower year on that front. And I think part of it was because we have a little higher churn in one of our regions.
So what I'm saying is, it's not a bad year, and don't get me wrong. When we sell the $90 million-plus per year, it was not bad. But we could, I think, a great year, we should do maybe 30% more, and this really helped on organic growth.
Okay. That's great color. Just a couple more. On Energere, I wonder, does this business have any U.S. clients currently? And if not, how easy would it be to gain U.S. customers? And the reason I ask is about recent legislation in the U.S., specifically the Inflation Reduction Act, it seems to throw some incentives towards using renewables. So I wonder, is there any reason you couldn't operate that business in the U.S.?
There is no reason. Actually, beginning of the year, we had a meeting between our U.S. business and our Canadian Energere to bridge a working environment structure to enable us to be able to offer to our U.S. clients. We have acquired maybe 10, 11 months ago. The first 3, 4 months, we had to learn business. And we had to look into some inner working, what challenges that we had to manage.
And now we are geared for growth in 2023. We have a good backlog in Canada. And you're absolutely right, I don't think there is a bad market. Like I think we should be doing good in a market like New York or the 5 boroughs. So our New York office is starting to work closely within those lines. But don't say it too loud. I don't want our competitors to know that.
Fair enough. And just one more on the housekeeping side. I asked about this last quarter as well, but I'm wondering about your working capital needs. That was a pretty significant investment in '22. It was almost entirely from accounts receivable. Are customers asking for deferrals? Is there any change in terms that would stretch out the cash conversion cycle for the future?
Well, working cap has been interesting during 2022. We started at a point at the end of Q3 -- at the end of Q2 and getting into Q3. There was a spike because of projects. A lot of working capital requirements were fueled by an acceleration in project delivery. And we worked on it very closely in Q4. We were able to get back to somehow a better normal than it was. Our objectives in 2023 is to reduce our working. David, I can say the number or...
Maybe a range.
Maybe a range? Okay, a range between -- that we are planning to reduce probably between $41 million and $39 million.
Your next question comes from Jeff Fenwick with Cormark Securities.
It's Lea on for Jeff. I wanted to get back into Canadian Janitorial. I know that you mentioned a number of the higher-margin COVID-related services have fallen away, but it looks like margins have largely held in. Do you expect the EBITDA margins to remain around the current level going forward? And if so, what is keeping them so high at current levels then going forward?
Well, again, I think the sustainability -- for sure, the 2022 margins were fueled by a larger demand on extra services, which is, like I said, has depleted substantially. We still have some, but not to the level we experienced at the beginning of 2022. But if you look at Q4 margin, I think that if things are all equal, I think we could live within the same area for 2023.
Okay. That's helpful. And then just to switch gears on to labor. The financials noted that 17 labor contracts have expired and then a further 46 or so to expire this year. Do you see any risks in terms of labor disruption?
Can you repeat the question? You cut out the first part. I'm sorry, can you repeat that, please?
Yes, no problem. So I was just referencing a note in the financials that said that 17 of the labor contracts expired and about 46 are going to expire this year. So I was just wondering if you anticipate the risk for any labor disputes related to those or labor disruption, sorry.
Well, again, I don't have a crystal ball. The general condition being that we have done and executed on many significant labor contracts in 2022, so we have a relatively clear vision on what the market, what the demand will be. So we're very confident that we can get through most of them.
Now this being said, having 150-plus CBAs, sometimes we fall on the more, I would say, I don't know how to say that, but the more difficult labor relation negotiation. But we are prepared, and we cope with it, and we do our job. At the end of the day, we are also the guardian of reasonability to service the real estate market. We cannot just shuffle extra costs.
And most of our business is really is a cost passing to our customers. So it doesn't give us like a freebie to do anything we want. We have to be very reasonable. So we negotiate with our partners. And so far, we have been able to maneuver over the last 30 years. This being said, inflation will create a little bit more of a volatility, but we have a pretty significant -- pretty clear vision of what the market looks like, so we are working accordingly.
Okay. That was actually going to be my next question. So if the wages were to move higher and how quickly you could pass that higher cost on to customers, but I guess it sounds like it's a bit of a negotiation customer by customer.
It's a negotiation. It's really, really a driven process. We negotiate collective bargaining agreements to be very -- it's the best environment. We are negotiating a collective bargaining agreement. But new wages, next day, client has the new wages and contract and probably 80%, 85% of the contract. Nonunionized areas, it's a process. We need to be very on top of it, and we need to track.
And we -- anyway, to make the long story short, we're very, very experienced to manage our increases to mister customer. And some customers where the markets are more difficult, like the office market, as you all know, we reorganized ourselves and our service level to cope for increases. So -- but again, it's a process where you have to be very rigorous. That's the key. The leakage is minimal if you do it well.
Next question comes from Derek Lessard with TD Securities.
Sorry about that. Yes, maybe just a few follow-ups for me and particularly on the last question. And it's more related to, I guess, increasing minimum wages. It's up in Quebec. Just wondering if there's any other geographies that you're keeping an eye on? And I guess, I was wondering, the same question is, how do you look at that in terms of the revenue margin and your contract negotiation?
Well, we have, example, in Canada, we have 4 regions. In the U.S., we have 4 regions as well. Derek, I don't know exactly how to pass the information. Quebec is an actually very specific market because 100% of the industry is regulated through a government agency. So it's a very clear path forward with mister customer.
They all know the rates. Everybody is acting on the same momentum. So for us, it's -- it's an easier path if you allow me in Quebec. The rest of Canada, again, Derek, is our rigorousness to track our contracts and track increases and pass them to customer through a very well-documented process is the key to successfully pass on the expense and the increases.
Now we have a fairly good assessment of the Central Canada market because we have negotiated several collective bargaining agreement, and one of them being the major one in Toronto and the other one, a major one, in Ottawa. So after this, it gives an alignment for all the other smaller CBAs that we have disseminated around the -- across the province.
In the West, labor shortage is -- it's a little bit critical, if you allow me to say. In the West, we have nothing. Our collective bargaining agreement in British Columbia is still not mature, and the rest is nonunionized. So it's a question of when we are increasing rates to our people, the customer needs to be aware and needs to agree on it.
Okay. Another one is, do you have an update on what you're seeing maybe in terms of cross-lead or cross-selling opportunities between Janitorial U.S., Technical Services 1 year after the acquisition?
It's, unfortunately, Derek, I do not have a specifically documented response to that. I hope that through our IT restructuration, where we're going to implement a global ERP with a global CRM, we will be able to really encompass our wins and deliver a more structured response to that. Now I go with we live day-to-day. There is continuous discussion between our technical and janitorial business.
I would say the janitorial business traditionally generate more leads on the technical side than the other way around. So it's a work in progress. But so far, I don't have a specific. If I were to guess, I would say that probably 10% of our customer or 15% of our customer works either/or with the 2 services.
Yes, that's fair, Claude. And just maybe some quick housekeeping. Depreciation, D&A was higher in Technical Services and Janitorial U.S. Just wondering if there's any onetime items in there? And how should we be thinking about your level of D&A going forward?
Stéphane, you'd like to maybe answer this one? So do you have your numbers?
Yes. No, there's nothing special. It really comes from the acquisition. So it's all pretty much all M&A related.
Okay. And maybe one last one ,Stéphane. The MD&A says the HR system is fully implemented by mid-2023, and total cost should be about $10 million. So -- and you spent about half of that. Just wondering if it's -- how we should be looking at that, the remaining in terms of costs in 2023 and how much would be capitalized?
And also, the ERP implementation is starting soon. Just wondering when you'd expect to complete that? And how much of a CapEx should you be expecting?
On the HRIS, most of it at this stage is really OpEx, like there's not that much CapEx from the remaining portion. We said that -- we had mentioned $10 million that where we are with what's left that we would be below the $10 million like from what we see right now. So you can put $3 million, $4 million more maybe in 2023 to finalize the HRIS.
On the dynamics, we're still at the early stage of the planning, the business case. So we have not completed that yet. We're working on it. So it's too early to provide a schedule and date of completion of this project. But as you know, these projects are long-lasting timing projects like -- but we're not there yet.
May I just add, sir, Derek, if I -- I would like to add something on Stéphane's comments, if you don't mind?
Yes. Sure.
I think one thing -- yes, one thing I'd like to share with you is, you see, large IT projects, you know the stories. The project, that goes well. We don't hear about that. The project, that goes back the year '20. I can tell you this, we took a position of maybe overdoing it a little bit instead of the money tension on this approach. But I think it paid off so far because our first launch of the U.S. business has been pretty significantly successful, with a success rate over 98%.
So it gives us a good comfort zone to continue and finish HRIS. And I think this issue, I wanted to share that with you. And again, for sure, dynamics, they are people -- sorry, I didn't want to put names, but the ERP component, we will have the same approach. I don't want to overdo it a little bit to ensure success of the operation.
Your next question comes from Zachary Evershed with National Bank.
In terms of the M&A pipeline versus where the balance sheet stands at the moment, you've had some comments on improving the working capital position so far this year. How is your dry powder position looking versus the strength of the pipeline at the moment?
So far, what we have -- so far, and again, I don't want to make disclosures, but we have a very active pipeline. So far, it's everything and like normal for us. We have enough dry powder to execute on our acquisitions in the foreseeable to foreseeable future. Should a monstrous opportunity come on, it will be maybe a different conversation. But for what we are working within, which is our usual bread and butter, we're pretty well charged up, and we -- I don't foresee any issue on the -- our financial capacity to execute.
And if you were to see that monstrous opportunity or the pace of smaller opportunities increases, is your preference to take your foot off the gas and crew or issue equity that ?
Listen, I worry when I had the problem in front of me, if you allow me to say. No, what we have, we're very good. Our strategy works well, and we have the capacity to do it. This is what I'm fully focusing on because this is our bread and butter. Now if something come up, there's different models that we can look at. But I don't want to speculate on something that is not realistic in front of us.
Fair enough. We'll cross that bridge when we get to it.
Absolutely. I have enough things to worry about without worrying for something that is not there.
Your next question comes from Liam Bergevin with Desjardins Capital Markets.
It's Liam for Fred.
Can you repeat your name, please?
Liam for Fred.
Liam. Okay, thank you.
Yes. So my first question would be on the integrated facility services. Would you be able to discuss a little bit on your execution so far on your 2 initial IFS contracts? Is there any notable learnings from these contracts that are potentially applicable to future contracts?
Liam, we always learn from everything we do. It's a new -- it's a new -- not a new approach, but it's a more structured approach to multiservices. As we go, we are learning to address customer requirements. We built our team. We have actually now -- we have one more resources on the U.S. development side. We learn every day.
Now is there any significant learning? We captured -- I cannot -- I don't have anything that comes in mind. The good news is the 2 large clients that we have taken lately, we are delivering on their expectation and contract delivers on our margin expectation, which is a really good start.
This is a big risk -- Liam, the big risk in those IFS contract is misunderstand the customer requirement and miscalculate the cost of operation. And I'm very -- we're very, very structured in that trend to minimize our impact.
Great. And maybe as a follow-up on the Technical Service, strong organic growth. Is there any specific facility types where you are seeing significant momentum like industrial or offices? Or are your market share gains widespread across essentially all building types?
Well, yes, I don't have a specific number per segment per region, but being disseminated in several regions that delivers sometimes different type of services. But I can tell you, and that through our U.S. business, we have developed significant capacity in piping, HVAC controls. And like I said, high-rise building retrofit that fueled us -- that fueled a lot of projects.
On the Canadian side, I think we have a very good year in terms of controls and building automation system contracts, which is a very big area for us. The rest is disseminated in every market where there is a bigger customer demand than we were able to acquire better market share in each of our segments.
[Operator Instructions]. There are no further questions at this time. Please proceed.
Thank you again for taking the time to discuss with us. I hope we were able to answer your questions to the best of our knowledge. And as we're getting in 2023, we will work hard to continue on our strategy. We will watch the market. We will also watch the credit market closely.
The post COVID, as you know, has been providing a lot of volatility. Interest rates are rising. Labor and inflations are also in the equation. I'm lucky to have such a great and talented team that is able to cope with all those variables and making sure that we protect the business and our employees in this variable environment. That can also lead to very, very nice opportunities in time.
So thank you very much, again, and I look forward to talking to you guys in the months of May, April, June. Thank you.
Ladies and gentlemen, this concludes your conference call for today. We thank you for participating, and ask that you please disconnect your lines.